Posted on 03/09/2020 5:53:24 PM PDT by willk
Nearly always a plunge is followed by a 50% fibo retracement. If it doesn’t get to 50, watch out!
If I had any money I’d be buying everyday.
Guarantee you that’s what the smart bigwigs are doing.
I wouldn’t expect a massive rally, though you can’t rule anything out. I think the selloff had more to do with the oil price collapse than anything. Oil longs had to sell positions to cover their leverage, and a huge drop in oil prices is a signal of an economic slowdown. The virus is probably in the mix too, but there wasn’t a whole lot of news over the weekend to cause a 2000 point drop in the DOW based solely on the virus.
And the oil price collapse had more to do with OPEC politics than the overall economy.
Note that some retailers went up today, because store shelves are empty. Retail cash registers are full. Look for an increase in Brinks truck hijacking. ;-) (Just kidding, I hope not!)
A healthy domestic oil industry is vital to our national security, so we should care about them. Those high-paying jobs are part of why our economy is booming, they create wealth and domestic economic well-being for a lot of people.
Yes, lower is better for most people, but too low is bad for all of us in the long run. Our guys can get by with oil in the $40’s, let’s hope it gets back up there soon.
It could do the retracement just in overnight hours....or not
We will see if Saudi Arabia does any jawboning..they aren’t going to let this oil thing go on for long
40 is still too cheap. Normal price for all is 60-70. Under 50 and above 80 is bad.
“Dead cat bounce” comes to mind as the most likely rejoinder. I’ll leave that part to the market-timers out there.
One surprising thing I’ve noticed — a lot of doom-and-gloom centred around the oil and gas industry. IMHO — ignore that (unless your portfolio is heavily weighted in O&G).
How soon you forget — just a few years ago, no American would see lower gas prices as anything but the huge economic stimulus it is. You were exporting money to import oil; so, lower prices were like a cash infusion into your economy.
When you were dependent on foreign supplies, the stimulus (actually, the relief from a major dampener) from lower oil prices was obvious. Now, you’re energy self-sufficient. Your oil and gas sector will take a (temporary) hit from lower prices. Meanwhile, all other sectors of the economy are receiving a major stimulus — to say nothing of the relief to household budgets.
Meanwhile, sit back and gloat about how hard the lower oil prices are hitting Iran. When it’s safe to be in crowds again, I expect massive demonstrations in the streets of Tehran. I wish (most of) the ordinary people there well — but, I’ll welcome the toppling of the regime.
I think the smart money waits for a sure thing, and betting on the come is not a sure thing. I do think today was an over-reaction due to a combination of factors, but the smart money would wait for a confirmation of a turnaround before plowing back in. Nibble a little, maybe, but be on the lookout for a dead cat bounce. They may sell into any strength. You just never really know.
Though, probably look for political moves like easing of tariffs, direct fed intervention, more repo purchases (buying back of bonds to inject cash liquidity to the markets) etc.
Azo was up huge today. Up over 50 points whilemost everything else was crushed I hardly trade that one because the spreads are so wide on their options
Tucker disappoints me. He is afraid of his shadow apparently.
ALL residents in Italy are ordered to stay home, is what I heard on TeeVee today. Sounds drastic to me.
I did nibble today, it was irresistible!
I am in the north east, it was a very mild winter here
My heating bill on my house with natural gas is about half of what it was last year
My building that I work out of, is on a half tank of heating oil, I generally burn an entire tank a year. I only heat that building to about 55 and will turn off the furnace once we are out of pipe freezing season, which might be this week.
This could also affect pricing as well. I am just pointing this out.
Saudi Arabia can outlast everyone. They have the cheapest cost of production anywhere in the world, and can ramp production up another 10% or so if they wanted to with a blink. They are trying to force everyone else’s hand. They won’t be jawboning, they will be waiting for others to capitulate.
dow futures up 643
WOW you guys are in denial.
I don’t think the market will be below 22,000. And it may even be up by summer or at least by end of year.
There’s A TREMENDOUS mount o junk bonds out there propping up a LOT of small and medium domestic oil producers.
With oil selling for anything under 55, they get hit hard.
And how many payroll tax cuts can be made without any spending cuts?
The average federal income tax is under 10,000 on 70k income.
The overnight rate is close to 0.
There’s no way of telling which direction this virus is going to go but with Italy Just exploding very recently there is no reason to think it’s going away with a whimper.
Many companies are cutting their earnings target
And the P/E on the dow was getting a little pricey anyway.
The market is still up over 30 percent in less than 4 years.
It’s been a tremendous run and it will continue.
But not now.
Collusion between Saudi MBS and PDJT? It is working!
I actually have AZO on my watchlist, but never trade it. I just sort of have it there as a bell weather for the auto sector. I don’t really know why it was up so much today I didn’t look. The spreads are very wide, I don’t know how liquid the options are but because it can move $20 up or down in a day the spreads are going to be big. That’s sort of true of all those stocks that refuse to split and trade in the $100’s a share (or $1000s like AMZN).
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